Mining is expected to begin in January at the Meteor Downs South coal operation, 45km southeast of Springsure in central Queensland, with first exports by the end of March.
U&D Mining is developing the thermal coal mine, through subsidiary Endocoal, in a joint venture with Minerva coal mine operator Sojitz Coal Mining.
Sojitz has set up an office in Springsure to engage the local community as it recruits for the new mine.
Sojitz Coal Mining managing director and chief executive off cer Cameron Vorias said the workforce for the truck and shovel operation was likely to sit around 20-35 in the first two years and ramp up to 60 or 70 employees.
In addition to positions at the mine, Mr Vorias said road haulage contractor Kalari HSE would also be looking to employ from the local area.
Mr Vorias said many of the supply relationships from Minerva would carry over to Meteor Downs South, however Sojitz would endeavour to offer some new opportunities for local businesses.
“There are still a number things on the supply side that we will be looking for,” he said.
“We do have Facebook presence and a website – that would be the best way to understand the project’s progress.”
U&D Mining chief financial officer Peter Edwards said the new mine would be brought online for less than $30 million.
The joint venture partners had met requirements with landowner Glencore, clearing the way for work on the box cut in early 2018, he said.
They will limit production to about 500,000 tonnes per annum for the first two years, when Meteor Downs South will rely on road haulage to get its coal to the Minerva rail load-out facility for transport to Gladstone port.
“We haven’t got a rail load-out facility and there are constraints on the current Bauhinia line, so initial tonnage will go by road and we’re looking at doing about 500,000 tonnes per annum,” Mr Edwards said.
“We have to go around the town of Springsure – so we want to minimise the impact that we have on the Springsure community.
“Nameplate capacity of 1.5Mtpa can be achieved when we have a rail load-out facility.”
The coal is likely to be blended with other coal product at the coal terminal to provide a different product to Glencore’s Rolleston coal mine product, which comes from the same seam.
For U&D, cash flow from Meteor Downs South will boost the kitty for further exploration at its Broughton and Rockwood projects.
“We would also look at other opportunities around in the marketplace to enhance our current production rate, because those projects are quite a long way off in terms of production so it would be quite good to be producing 2Mtpa rather than 500,000,” Mr Edwards said.
“We would look at any potential opportunity that doesn’t cost too much to get into and gives us the opportunity to become a bigger producer.”
Sojitz Coal Mining is also on the prowl for further mining opportunities in the Emerald region, where Minerva employs about 250 people.
“Minerva is going through its mature cycle at the moment,” Mr Vorias said.
“Its resource is quite limited now and really we’re looking at other opportunities around the Emerald area to ensure that we have future opportunities for what is probably one of the best mining workforces in Australia.
“That’s our primary focus at the moment. We have Meteor Downs starting up and then we’re looking at development of other opportunities around the Emerald region.”
Mr Vorias said the Minerva operation had a mine life of at least five more years and Sojitz Coal Mining was exploring various options to extend that out to 10 or 15 additional years.